Profit-bringing Issuers from the Carbon Exchange

Selasa, 30 Mei 2023 | 10:23 WIB
Profit-bringing Issuers from the Carbon Exchange

ILUSTRASI. Profit-bringing Issuers from the Carbon Exchange

Reporter: Akhmad Suryahadi, Yuliana Hema | Editor: Tiyas Septiana

KONTAN.CO.ID -  JAKARTA. The carbon exchange is starting to brighten up a bit. The Financial Services Authority (OJK) is targeting the carbon exchange to be ready to operate by September 2023. If there are no obstacles, OJK will issue the first rule related to the carbon exchange on June 12, 2023.

Executive Analyst of OJK's Directorate of Capital Market and Sharia Market Development, Agustyatun Muji Rahayu, said that OJK is currently discussing drafting the regulation with the House of Representatives (DPR). "OJK rules are in process with the DPR," he explained to Kantan on Monday (29/5).

On a different occasion, OJK Chairman Mahendra Siregar said, carbon exchange trading will be carried out with a result-based payment (RBT) mechanism. "The initial plan for RBT to be traded is 100 million of carbon dioxide (CO2)," said Mahendra. 

Under the RBT mechanism, carbon producers have the right to sell their carbon. The buying and selling mechanism will be carried out at the carbon exchange. 

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This carbon exchange will regulate carbon trading, including the recording of carbon ownership and sales to domestic and foreign parties or companies.
With the carbon exchange, a number of issuers are able to gain domestic benefits. One of them is PT Indika Energy Tbk (INDY). 

Ricky Fernando, INDY's Head of Corporate Communication, said that the company continues to explore the potential of carbon trading, including what INDY's subsidiary Indika Nature has done. The company develops nature-based solutions and focuses on energy plantations, environmental services, and agroforestry businesses. 

In relation to carbon trading, by 2022, INDY will also voluntarily purchase carbon credits from the world's largest blue carbon project.  "The move is aimed at offsetting 52,800 tons CO2eq of our emissions. The project protects and restores 350,000 hectares of area in Sindh province, Pakistan," Ricky said. 

Emission reduction

Henan Putihrai Sekuritas analyst Ezaridho Ibnutama said INDY has also conducted carbon trading following the company's target to reduce carbon emissions by 550-kilo tons (Kton) to 600 kton of CO2 emissions under its subsidiary, Indika Multi Properti (IMP), by increasing land reclamation by 20% by 2025.

"Besides INDY, PT Pertamina Geothermal Energy Tbk (PGEO) has started trading carbon credits as well," Ezar said. This subsidiary of PT Pertamina is generating new revenue from carbon credits. Last year, PGEO booked a carbon credit revenue of US$ 747,000. 

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This carbon credit revenue was generated by two Geothermal Power Plants (PLTP), which are Ulubelu units 3 and 4 and Karaha. These two PLTPs produce the equivalent of 1.7 million tons of carbon emission reductions. Carbon emission reductions are calculated from the time the two PLTPs began commercial operations until early 2020. 

In addition to PGEO, PT Barito Pacific Tbk (BRPT) generates revenue from carbon trading. Last year, this issuer made by Prajogo Pangestu, earned US$ 3.57 million from the carbon credit segment.

Ezar added that PT Adaro Energy Indonesia Tbk (ADRO) also has the opportunity to benefit from carbon trading. ADRO has also started planting mangrove forests, which are optimal for absorbing carbon from the air. Henan Putihrai Sekuritas gave INDY shares a buy rating with a target price of IDR 2,910.